China’s iron ore futures surged nearly 6% to hit a record high on Wednesday, following a broad rally in prices across assets, as investors hoped that trade talks between Beijing and Washington would restart after a recent lull.
China and the United States are rekindling trade talks ahead of the G20 meeting in Japan next week between U.S. President Donald Trump and his Chinese counterpart Xi Jinping, the two countries said late Monday.
The lingering trade tensions between the world’s two largest economies have roiled markets and affected global economy. Talks between the two sides to reach a broad deal broke down last month and interaction since then has been limited.
Lifted by hopes for a trade truce, the most-active iron ore futures on the Dalian Commodity Exchange soared as much as 5.8% to 812 yuan ($117.66) a tonne, the highest level since the contract was launched in 2013.
Meanwhile, data from Mysteel consultancy showed that total iron ore shipment from Australia and Brazil fell 706,000 tonnes last week from the prior week to 22.15 million tonnes, which stoked concerns of tight supplies in the near-term.
“Although some steel mills may reduce output amid heightened environmental measures, or schedule maintenance to support steel prices … In general, fundamental situation of iron ore remains strong,” said analysts from Huatai Futures in a note.
Benchmark Shanghai rebar prices were up 1.7% at 3,774 yuan a tonne, as of 0135 GMT.
Hot-rolled coil futures advanced 1.9% to 3,644 yuan a tonne.
Dalian coking coal climbed 0.9% to 1,396.5 yuan a tonne, while coke contract for September delivery edged up 0.7% to 2,063 yuan.
Source: Reuters
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